Evergreen Marine Corp, one of the world's top container shipping operatorss, has made several significant announcements over recent weeks that demonstrate its dedication to fleet efficiency, sustainability, and capacity expansion amidst an optimistic outlook for global cargo demand recovery.
Megaships Strategy Reaffirmed for European Trades
Eric Hsieh, president of Evergreen Marine, stated at an investors conference in Taipei that his company will keep operating 11 megavessels exceeding 20,000 TEU on Asia-Europe routes, such as Panama-flagged Ever Given owned by Japans Shoei Risen Kaisha Ltd and chartered to Evergreen Marine. Hsieh noted that to remain competitive against larger vessels owned by rivals, remaining with 14,000 TEU ships would place Evergreen Marine at an disadvantage.
Evergreen Container Line plans to switch out its fleet of 14,000 TEU vessels for larger 24,000 TEU ones over the coming years, positioning itself as the market leader and making Evergreen invincible. In 2019, Samsung Heavy Industries, Hudong-Zhonghua Shipbuilding and Jiangnan Shipyard were contracted to build 10 vessels at an estimated cost of US$16 billion for Evergreen at this cost; deliveries are scheduled to commence later in 2019. As per company data, larger vessels reduce fuel costs per unit when fully loaded while increasing margins when fully loaded according to company estimates.
Evergreen recently addressed the Ever Given Suez Canal blockage that left it idled for six days last month and clarified they bear no responsibility as its owner manages operations. While 11 Evergreen ships were affectedthree rerouted via Cape of Good Hope while eight delayedagain, risk remains minimal with coverage provided through insurance policies.
Recent Newbuilding Orders for LNG dual-fuel ships
Evergreen received an order for six 24,000 TEU LNG dual-fuel ultra-large container ships valued at over USD 1.6 billion from South Korean's Hanwha Ocean on 17 March for USD 1.6 billion, reflecting ongoing fleet commitments. These 400-meter long vessels with 61.5-meter width feature advanced eco technologies including LNG propulsion systems, shaft generator motor systems and air lubrication to comply with tightening environmental regulations while optimizing fuel efficiency.
Hanwha Ocean CEO Kim Hee-chul touted the order as evidence of Hanwha Ocean's capabilities in producing eco-friendly ultra-large carriers. Evergreen secured 11 LNG dual fuel container ships from South Korean and Chinese yards as part of its decarbonization efforts, totalling $3.2 billion in value.
Evergreen's moves reflect industry trends, as evidenced by peers such as Yang Ming's purchase of seven vessels from Hanwha Ocean; Evergreen is now leading in low-emission containership operations.
Container Investment and Rate Outlook
Evergreen announced an investment of $174 million across three suppliers - including their own manufacturing arm - to meet rising demand, amid hopes for global economic recovery. This move strengthens capacity while increasing efficiency.
President Wu Kuang Hui predicted an increase in transpacific contract rates by 2025 due to disruptions caused by events like an impending US east coast dockers strike that threaten global supply chains. By taking proactive steps like this one, this proactive stance aims to safeguard profitability across key trades.
Sustainable Partnerships offer many advantages to their members.
Evergreen announced today a Memorandum of Agreement with X-Press Feeders to deploy 14 dual-fuel green methanol vessels across Europe and the Mediterranean from Q2 2024 through mid-2026, beginning deliveries by mid-2026. COO Francis Goh of X-Press Feeders stressed the urgency of such efforts towards mitigating GHG emissions while reinforcing Evergreens net-zero ambitions.
These initiatives aim to strengthen operational resilience, decrease emissions and position Evergreen for sustained growth in an increasingly competitive marketplace.